September 22, 2008 / 5:19 PM / 11 years ago

UPDATE 2-BP says BTC oil pipeline shipments cut after gas leak

(Adds details, BP comment)

By Alex Lawler

LONDON, Sept 22 (Reuters) - The BP Plc-led (BP.L) Baku-Tbilisi-Ceyhan (BTC) oil pipeline is pumping less oil following a Sept. 17 gas leak that cut output from fields in the Caspian Sea, BP said on Monday.

The reduction in supplies through the pipeline, which can pump an amount equal to 1 percent of world supply, comes only weeks after the flow resumed after a fire on the line in eastern Turkey halted shipments.

“The volumes though BTC are reduced and match production volumes,” said BP spokesman Toby Odone. He did not specify the level of field production or the amount of oil being sent through the pipeline.

BP said last week that output at the Azeri-Chirag Gunashli fields in the Caspian was cut to around 40 percent of its rate before the Sept. 17 gas leak in the area of the Central Azeri platform, which prompted its shutdown and that of another installation.

The ACG fields, the main source of oil for the BTC pipeline, had been pumping about 850,000 barrels per day before the shutdown.

An industry source said that the volumes being shipped through the pipeline had been higher than production because some oil was being pumped into the BTC from storage in Azerbaijan.

London-based BP also said it was investigating the gas leak and had no date set to restore output to normal at the ACG fields.

“A diver support vessel has been out to find out what the source of the leak is,” Odone said.

“Once that is determined, we will be able to work out the plan for how to deal with it and then to bring production back on.”

The ACG fields produce high-quality crude priced at a premium to many others. They suffered a severe reduction last month after BP halted the BTC pipeline for 20 days following a fire at a section in Turkey.

BP is the largest shareholder in both the ACG fields and the BTC pipeline, with stakes of 34.1 percent and 30.1 percent respectively.

Oil traders said that while loadings of Azeri crude at Ceyhan in Turkey were continuing, there may be some impact unless production returns soon to the normal rate.

“We believe the next two loadings totalling 1.6 million barrels will load from existing Ceyhan inventory, albeit slightly later than expected,” said one. “Thereafter, we are not sure.” (Reporting by Alex Lawler, editing by Michael Roddy)

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